Coinbase CLO Reveals Timeline For Summary Judgement In SEC, FDIC Case

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As a seasoned crypto investor who has navigated through numerous regulatory storms, I find myself closely following the unfolding saga between Coinbase and the U.S. Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC). The recent updates from Coinbase’s Chief Legal Officer, Paul Grewal, have added another intriguing chapter to this captivating narrative.

Paul Grewal, Coinbase’s Chief Legal Officer, recently provided insight into the ongoing legal dispute between the U.S Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC), as per the Freedom of Information Act (FOIA) lawsuit.

As a researcher, I’m sharing an update based on Grewal’s recent statements: The Securities and Exchange Commission (SEC) has concluded its investigation into Ethereum 2.0, and we can anticipate the summary judgment briefing to ensue, with a verdict anticipated in 2025.

SEC and FDIC Withholding Documents

Through several posts, Coinbase’s Chief Legal Officer, Paul Grewal, indicated that both the SEC and FDIC have admitted to having the records sought by Coinbase. Yet, they claim they can keep these documents confidential because of governmental privilege.

Yesterday, I found myself engaged in ongoing Freedom of Information Act (FOIA) litigation suits, where both the SEC and FDIC submitted their responses. To refresh your memory, I’ve been dealing with the issue of the SEC withholding documents from closed investigations, such as those concerning Ethereum 2.0, which I believe should have been disclosed. Similarly, the FDIC has withheld the “pause letters” it sent to banks, warning them to stop certain activities. These documents, in my view, should be made public for transparency and accountability purposes.

— paulgrewal.eth (@iampaulgrewal) August 8, 2024

Coinbase is currently trying to obtain records concerning completed investigations, one of which pertains to Ethereum 2.0, an investigation that the SEC has stated is now closed. Additionally, the FDIC has refused to disclose the alleged ‘pause letters’ that were sent to banks, instructing them to halt interactions with cryptocurrency companies.

“Grewal stated that we’ve asked the SEC for records on past closed investigations, aiming to understand their perspective on their broad and potentially unconstitutional authority. Notably, one of these investigations, recently finalized, pertained to ETH, a matter where the SEC declared in 2018 that it is not considered a security.”

1. The Ethereum case resolution stating it’s not a security preceded the XRP lawsuit. As per Coingape’s report, Ripple was mandated to pay around $125 million in civil fines, effectively ending the SEC lawsuit and deciding that XRP is not classified as a security.

Coinbase CLO Timeline For Summary Judgement

In an earlier decision, the SEC declined to disclose requested information, invoking “exemption 7A” of the FOIA, which protects details that could potentially impede law enforcement investigations. Notably, Grewal highlighted that these cases will not involve the discovery process, and the summary judgment briefing is anticipated to commence soon, with a final verdict expected in 2025.

Previously, History Associates Inc., acting on behalf of Coinbase, filed a lawsuit against both the Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC). They argued that these regulatory bodies had improperly declined Freedom of Information Act (FOIA) requests which should have been made public under open-records laws. These documents are crucial as they help in understanding how the SEC determines whether a digital asset is classified as a security.

One ongoing legal dispute between Coinbase and U.S. financial regulatory bodies includes a case where the Securities and Exchange Commission (SEC) claims that Coinbase ran an unlicensed securities trading platform.

Furthermore, Coinbase took legal action against the SEC to compel them to clarify their definition of digital assets as securities. Later, they filed a lawsuit against the FDIC, alleging that pause letters were part of a strategic move by financial authorities, aiming to pressure banks into reducing their ties with digital asset companies.

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2024-08-08 20:38